Athens / AFP
An assessment of Greece’s attempts to reform its struggling economy is being held up by disagreements between the European Union and the IMF, Prime Minister Alexis Tsipras has said.
“Negotiations on the reform plan have fallen behind, which is in nobody’s interest,” he said on Sunday, cited by the Avghi daily, close to Tspiras’ Syriza party.
Greece sent creditors its pension reform plans at the start of January but “to date we have had no official response from the institutions, which is due to disagreements at their heart,” Tsipras asserted. Facing fears it may yet have to quit the eurozone, cash-strapped Greece is under mounting pressure to deliver credible reforms, notably on pensions, International Monetary Fund European zone head Poul Thomsen said last week.
The IMF worked with the EU on two previous bailouts for Greece since 2010 but the IMF said itself it would not participate in the third rescue plan without credible reforms and an EU agreement to ease Greece’s debt burden.
Ten days ago, a first round of talks held in Athens between creditors and Greek authorities proved inconclusive. The Greek government says further talks will be held soon. But Thomsen’s comments last week warned against “over-optimistic assumptions (which) will soon cause Grexit fears to resurface once again and stifle the investment climate.”
He added that pension reforms were crucial—Greece spends some 17 percent of GDP on pensions according to Eurostat, more than any other EU member.
For a time last year there were fears Greece would have to exit the eurozone after defaulting on a debt payment to the IMF, which fears Athens’ ability to deliver on reforms to cut soaring public debt.
But in July the EU stepped in with a new €86 billion of financial aid programme—which the IMF has not joined—in exchange for economic measures and pension reform, still the subject of hot debate. Athens responded to Thomsen’s concerns by accusing the IMF of “demanding the application of a radically different programme than that agreed” by Greece and its eurozone partners last year.
Avghi further quoted Tsipras as saying Greece “demands an end to fetters put unilaterally in place by some (people) preventing a first evaluation” of Athens’ proposed reforms. He added that “Europe cannot continue discussing unreachable (budgetary) objectives, especially now, when it is facing important challenges such as the migration crisis” stemming from the conflict in Syria.